This is the end of sub 5.0% mortgages, go check your lenders, rates are up big time from the lows this summer. If you haven't bought or locked in I suggest you do. By next spring you will be paying up to 1.0% more on top of todays rates.

The unprecedented affordability in the housing market is coming to an end as interest rates begin their rise and home prices stabilize in many areas. Although mortgage interest rates have fallen from their summer high, the speculation is that the sub five percent rates are gone again. As the economy recovers, expect interest rates to rise even more.

“So are sub 5.0 rates gone forever? The short answer is probably yes. While rates might briefly fall below 5 in the next month, for the most part the era of sub 5.0 rates is over. Mortgage rates rose for the third straight week. The 30-year rate rose from 5.00 to 5.03.The only two mortgage products that are interesting is the 30-year and the 15-year fixed rates. A mortgage payment is about $13 more than two weeks ago and about $2 less than it was six months ago.

So why are rates rising? Although it’s a weak recovery, the economy by most accounts is experiencing a recovery. In addition, the government has lowered the amount of mortgage-backed securities it was buying, which was keeping rates artificially low.”

Buyers on the sidelines are realizing that interest rates rising a percentage point is a reality. Between now and a year from now we could see marked improvements in the economy, causing higher interest rates and inflation. Gray advises those looking to buy to lock in their mortgage while affordability is still high.